California won't extend canceled health policies

Updated 7:23 pm, Thursday, November 21, 2013

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Covered California, the state's health exchange, has rejected President Obama's request to let insurers extend their current health policies, a decision that affects about 1 million Californians who have coverage that doesn't comply with the requirements of the federal health law.

The unanimous vote came Thursday at a meeting in Sacramento of Covered California's five-member board of directors. It means that the agency will continue to require the 11 health insurers that sell coverage through the exchange to terminate by Dec. 31 those individual policies that do not meet all the standards of the Affordable Care Act.

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Peter Lee, Covered California's executive director, said extending the deadline would not help consumers. "Our board decided pushing problem down road and leading to potentially more confusion ... was actually too big of a risk," he said during a press conference after the vote.

Obama made the request last week after millions of policyholders around the country received notice they would have to change policies despite the president's promise that anyone wanted to keep their health plan could do so. The controversy only added to the debacle surrounding the launch of the health law's federal website.

Covered California and health insurers had expressed concern that allowing people to keep their noncompliant plans would result in younger, healthier consumers staying out of the risk pool for the new state exchange. Attracting healthy, young people who would probably be infrequent health care users is a key element in keeping overall costs down for others in the exchange.

California Insurance Commissioner Dave Jones, who wanted people to be able to keep their policies, called the board's decision a "disservice" to California consumers.

Jones said people will have to scramble to select a new plan. "They now face a very tight deadline to have to make a decision," he said.

Some consumer groups also expressed frustration at Thursday's decision.

"It's outrageous that this board would acknowledge that half of canceled policyholders will have rate hikes, then block them from continuing their coverage for another year," said Jamie Court, president of Consumer Watchdog, which is based in Santa Monica.

The action shows that the agency is more on the side of insurers, "not the policyholders, by standing in the way of President Obama's call for action," Court said in a statement. "Shame on them."

But insurers and some lawmakers supported Covered California's decision.

"The Covered California board has made the appropriate decision to stay the course. To its credit, California is well ahead of the rest of the country in implementing the Affordable Care Act," said Senate President Pro Tem Darrell Steinberg, D-Sacramento, in a statement.

As part of Thursday's announcement, Covered California officials said people will have until Dec. 23, rather than the original Dec. 15 deadline, to sign up for coverage if they want it to start on Jan. 1. The deadline to make the first payment on that policy was extended from Dec. 26 to Jan. 5. Enrollment still extends until March 31.

Covered California also released more detailed enrollment information. As of Tuesday, nearly 79,900 people had enrolled in a health plan through the exchange, and another 135,000 had enrolled in Medi-Cal.

Los Angeles County had the highest number of enrollments, with nearly 7,000. In San Francisco, 892 people had enrolled. Alameda and Contra Costa counties had signed up 1,754 and 1,273 people, respectively. Many of those enrolling are what are known as "young invincibles," or the younger people considered key to the survival of the new marketplace, according to the new data.

Of the 30,830 people who enrolled in October, state officials said, 6,900 - about 22.5 percent - were between the ages of 18 and 34, which is slightly higher than the proportion of that age group in California's population. About 21 percent of the state falls in that age group.

But the majority - about 56 percent - came from those in the 45 to 64 age group.

New hotline

Covered California has established a telephone hotline for enrollment questions. The hotline, (855) 857-0445, will be available beginning Monday.

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